A Quick Guide on How to Create a Real Estate Investment Business Plan
By [http://ezinearticles.com/?expert=Sherry_Ann_Smith]Sherry Ann Smith
When creating a project or finishing a task at work, are you the type who makes an outline or a checklist of tasks to do or are you the type who wings it? The latter may not be a very good idea especially if you are starting out a business. Let's take property investing as an example. Over the years, more and more people are starting to consider this as a profitable venture in addition to their day jobs. If you want to be in this business, it's important to have a real estate investment business plan so you can achieve your goals in no time at all.
Why It Pays to Map Out an REI Business Plan
Why is it important to create a business plan when getting involved in property investing? With a solid plan, you increase your chances of success. If you wish to earn profit with as little ground work as possible, for instance, you may join a property investment group that manages an apartment complex or condominium units. You can invest in several units but the investment group does the maintenance tasks for you in exchange for a percentage of the profit. With a solid business plan, you can weigh the advantages and disadvantages of each real estate investment instrument available and decide whether you can profit from them or not.
Step 1: Establishing Your Financial Goals
So what's the first step you can follow when creating a real estate investment business plan? First, establish your financial goals. Are you looking forward to using the profits from your REI instrument as retirement money or do you need an extra source of income? Set a schedule for achieving these financial goals whether they're five or ten years into the future. Better yet, determine your desired net worth. The more specific you are, the better; you can work on achieving those financial goals effectively.
Step 2: Choosing the REI Program to Go for
There are several REI programs that you can go for. First, there's the basic rental property investment. Here, you purchase a property and rent it out for profit. It's entirely up to you to decide whether you want to act as landlord or hire someone else to do it for you. As mentioned earlier, you can join a real estate investment group. You may also dabble in real estate trading. Think of it as the equivalent of day trading in the stock market. You're basically holding on to a property for a few months, after which you sell them again for profit. This technique is also called flipping properties. Finally, you can invest in REITS or Real Estate Investment Trusts, which are similar to dividend-paying stocks. Unlike other types of real estate investment programs, REITs allow you to invest in commercial properties such as malls or office buildings for a better profit yield.
Step 3: Planning How to Achieve Your Financial Goals
After deciding which REI program to go for, plan how to achieve your financial goals. This is where a lot of research is needed because you have to calculate down payment amounts, monthly mortgages, operating expenses, and so on. Once your business plan is finished, you now have a clear series of steps to follow when it comes to growing your real estate venture.
If you wish to succeed in your real estate business, you need to devote time to developing a solid [http://www.realestateinvesting-gurureview.com/real-estate-investment-business-plan.html]real estate investment business plan. Your plan serves as your blueprint, as the real estate business is vast and complex. Having a plan can help you minimize your risks and losses. For more information, visit [http://www.realestateinvesting-gurureview.com/real-estate-investment-business-plan.html]Real Estate Investing Guru Review.
Copyright � Sherry Ann Smith
Article Source: [http://EzineArticles.com/?A-Quick-Guide-on-How-to-Create-a-Real-Estate-Investment-Business-Plan&id=6616334] A Quick Guide on How to Create a Real Estate Investment Business Plan